Brookstein v Brookstein

The parties were married out of community of property subject to the accrual system. Upon divorce in 2008, a settlement agreement regulating all matrimonial consequences, including accrual, was made an order of court. The respondent later discovered that the appellant had allegedly deliberately failed to disclose the true value of his interest in the Patula Group, resulting in a substantial understatement of his estate’s accrual. She instituted a delictual claim for pure economic loss based on fraudulent or negligent non-disclosure. The dispute was referred by agreement to arbitration, and subsequently to an appeal tribunal, which awarded her damages based on the difference between the true accrual value and the settlement amount. The appellant sought to set aside the arbitration appeal award, contending that the dispute was a matrimonial matter incapable of arbitration and that the accrual was incorrectly valued as at the date of divorce instead of litis contestatio.

The appeal was dismissed with costs, including the costs of two counsel. The arbitration appeal award stood, subject to correction of an acknowledged clerical error.

The case authoritatively clarifies that delictual claims arising after divorce for non-disclosure of accrual are arbitrable and are not ‘matrimonial causes’ under the Arbitration Act once a divorce settlement has been made an order of court. It also definitively settles conflicting High Court authority by confirming that accrual must be valued at the date of dissolution of the marriage, not at litis contestatio.